Think SpaceX stock looks silly? Here are 3 shares to consider buying instead 

SpaceX stock is up 41% since the beginning of August, giving the company a $2.07trn market cap. To some, this is utterly ridiculous, given that SpaceX only posted $18.7bn in revenue last year and is currently loss-making.

Yet the long-term growth potential of the global space economy is huge. According to McKinsey, this market is expected to be worth as much as $1.8trn by 2035, from less than half that today.

If you’re interested in investing in space but think SpaceX is overhyped, here are three other options to consider.

Rocket Lab

The first is Rocket Lab (NASDAQ:RKLB). A maker of rockets, satellites and space components, it carried out the 96th flight of its Electron rocket over the weekend. The firm is the second most active commercial launch provider behind SpaceX.

Last year, revenue surged 38% to $602m. But this figure is expected to be much higher by 2030, bolstered by the firm’s $8bn acquisition of Iridium Communications.

Beyond adding almost $1bn in annual revenue, the deal gives Rocket Lab a 66-satellite constellation and global L-band spectrum rights. This ready-built communications network should significantly increase the firm’s total addressable market.

Another attractive thing is that the stock is down 57% since May. This doesn’t make it cheap — it’s trading at 27 times next year’s forecast sales, meaning a lot of growth is already priced in. If this fails to materialise, along with profits, there could be trouble ahead.

Yet I think the 57% crash could prove to be an attractive entry point for patient investors. Note that Rocket Lab’s market cap of $38.6bn is a fraction of the size of SpaceX.

Filtronic

Turning to the UK now, we have Filtronic (LSE:FTC). This is a communications technology company that’s supplying SpaceX with E-band solid-state power amplifiers (SSPAs) for its Starlink ground stations.

Additionally, Filtronic’s products are used in defence communications. So it’s operating in two high-growth markets.

The stock has slumped 47% since May. Again, this doesn’t mean it’s a bargain. The forward price-to-earnings ratio is 67.

At this valuation, there’s no room for poor execution or setbacks. And it’s worth mentioning that SpaceX accounts for a significant amount of revenue, adding a high level of customer concentration.

That said, the future growth opportunity appears significant, with SpaceX planning a massive expansion of Starlink over the next decade. It’s also working with the rocket and satellite giant to develop SSPAs at frequencies other than E-band. 

Filtronic recently bagged an $8m follow-on order with another US customer for the design, development and build of prototype units to be deployed on satellites. So it’s succeeding in broadening the customer base.

FTSE 250 space-tech trust

Finally, I want to highlight Seraphim Space Investment Trust. This FTSE 250 trust has built a promising portfolio of space-tech companies, including Google-backed Pixxel and sovereign intelligence firm ICEYE, now one of Europe’s most valuable private space companies.

This is probably the most speculative of the three stocks because many of its holdings are unproven. Some could even go under in future.

Conversely, this trust may well have the most potential for big returns if a couple of its investees go on to become industry leaders. Especially after tumbling 31% from a peak earlier this year.

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Ben McPoland owns shares in SpaceX.